Soaring cotton prices hit Bangladesh textile industry

The surge in world cotton prices has had an impact on Bangladesh’s nascent textile industry. Local spinning prices have risen by 30% in the past two months, causing serious disruption to Bangladesh’s textile exports. The local spinning price surged from US$2.75 two months ago to US$3.5, and the increase in spinning price was mainly due to the surge in international cotton prices. International cotton prices have recently increased by 9%, while Indian cotton prices have increased by 20%, while total cotton production has decreased by 5%, from 234 million tons in 2008 to 222 million tons. 90% of Bangladesh’s spinning yarn comes from the local market, and the rest is mainly imported from India. According to data from the Bangladesh Export Promotion Agency, Bangladesh’s knitwear exports in fiscal year 2009-10 fell by US$967 million compared with the same period in 2008.
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